Reduction of transportation by road and a shift towards rail: update by the Department of Transport

NCOP Public Services

08 February 2012
Chairperson: Mr M Sibande (ANC, Mpumalanga)
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Meeting Summary

The Department of Transport indicated that road freight transport had expanded rapidly since the deregulation of the industry in 1989. That had caused deterioration of roads. At the same time, insufficiencies in the railway system had made road transport the default choice. The road freight system carried 87% of total freight in the country.

There was an ageing rail infrastructure, and major revolutions in railway systems had bypassed the country. There was a lack of investment and customer interest in rail. That trend had to be reversed with state involvement in investment and private sector participation. There was a proposal for an Integrated Transport Commission. Legal impediments and institutional arrangements that hampered the move to rail transport, were highlighted; most importantly, the Department of Transport did not ‘own’ the railway system. It resorted under the Department of Public Enterprises (DPE).

In discussion, the Department was strictly taken to task about a failure to come up with a comprehensive plan as this problem had been identified years ago. It was suggested that planning be divided into phases. Members felt that the Department of Transport had not made use of existing experience, that it had long known the need to reverse the trend to road transport without acting on that knowledge. There were questions about the Sishen/Saldanha and Hotazell/Port Elizabeth rail corridors. Members noted that rail corridors in remote rural areas could not possibly create jobs. There was a question about the inevitability of privatisation. The position of rail lines and rolling stock in neighbouring countries was discussed. The Chairperson advised that the Department cost plans to improve rail, to which the Department replied that it had done so. There was concern about railway sabotage and looting, as well as the lack of customer focus. The Committee urged the Department to engage interdepartmentally with the Department of Public Enterprises, change legislation and cost the plan. Since customers and investors were not being attracted, the Department had to market this. It also needed to provide more detail to this Committee.

Meeting report

Department of Transport on work done to move bulk loads off the road network towards rail
Mr Mawethu Vilana, Deputy Director General, spelled out reasons why bulk loads such as coal, sulphuric acid, wood, had to move off the road network towards rail. He noted that there was deterioration of the road infrastructure, due to overuse by heavy vehicles. The rail infrastructure had deteriorated as well, and there was insufficiency of rail freight movement.

Mr Vilana stated that the road freight industry had expanded rapidly since deregulation of the industry in 1989. Cargo had migrated to road rather than rail due to insufficiencies in the rail system. The road freight system now carried 87% of total freight in the country. He pointed out the key freight corridors for rail in the country, and the planned growth for each to 2020. There was an ageing rail infrastructure. The last 40 years had seen only maintenance of existing systems. The country had missed out on five revolutions in railway technology and management. Another challenge was the lack of integration amongst major transport modes such as road, rail, air, maritime and pipelines.

Factors contributing to the decline of freight rail were a lack of flexibility in service offering, insufficient investment in network and rolling stock, and a lack of customer focus. Interventions considered were a clear rail industry model and promotion of rail transport as a mode of choice for freight transportation. There had to be active state involvement in investment and private sector participation. Insufficient rail capacity had led to road becoming the default choice for land transport, and that trend had to be reversed. There had been a proposal to establish an Integrated Transport Commission. The establishment of a Single Transport Regulator and a Rail Economic Regulator was being finalised. A draft Green Paper for the development of a rail policy was being finalised.

Mr Vilana indicated legal impediments and institutional arrangements that caused bottlenecks. Importantly, the Department of Transport did not ‘own’ railways as it fell under the Department of Public Enterprises (DPE). There had to be engagement with Transnet about the cargo most suitable to be moved to rail, usually bulk and heavy cargo of a non time-sensitive nature.

The Chairperson expressed concern about deteriorating roads. There was a contradiction between the inability to maintain roads and the insufficiency of rail. In Mpumalanga, rail materials were taken by farmers to use for their own purposes. He asked where the problem of lack of funds could be located. With reference to page 5 of the document, he remarked that the condition of roads in his constituency area of Bethal was disgraceful. Roads were supposed to have been repaired, but as he put it, there were potholes the size of swimming pools. The lack of railway in the Witbank and Ermelo regions caused many road accidents to happen. Entities like ISCOR had tried solutions like conveyor belts, but the Department of Transport did not seem to have a plan.

Mr M Jacobs (ANC, Free State) noted that he had told Transnet at a meeting in Port Elizabeth that the rail system had collapsed during Apartheid. Those currently in power had lacked a plan to cope with that. Deregulation of road transport had occurred in 1989 already. Planning done since 1994 had not resulted in appropriate political action. This large problem had to be discussed with reference to phases, and the challenges to be met during each phase. The presentation lacked future planning. In competition with the private sector, they had taken all. The Department of Transport had a capacity for research. Practical solutions had to be found. No long-term objective had been developed over the preceding 17 years. A master plan should have been in place already. The picture was not encouraging.  Problems should have been addressed with the help of existing experience.

Mr Vilana agreed that railways did not work under Apartheid. Deregulation in 1989 made matters worse. Maize boards were moving maize by rail before that. It was because rail did not work under Apartheid that there was currently a crumbling infrastructure. There had been no real investment prior to 1993.

Ms M Themba (ANC, Mpumalanga) agreed with Mr Jacobs about the way forward. She asked what the Committee was supposed to tell people about what the Department of Transport was actually doing. She asked when had the need to reverse been recognised. The question was what had been done since 2009, if DoT only presently admitted that there was a need to reverse. Nothing was happening, in spite of the beautiful DoT presentations. It was unacceptable, and she was disappointed.

Mr Vilana replied that the need to reverse had indeed been known for a long time. But the Department was barred from implementation of rail measures by existing law. It was not part of its mandate. The rehabilitation of the branchline network had been costed. He suggested that the Department be called in together with the Department of Public Enterprises. There were bottlenecks due to institutional arrangements.

Mr H Groenewald (DA, North West) said that he wished to endorse what the previous speakers had said. Every year things were brought to the attention of the Committee, and the following year it would still be unchanged. The whip had to be cracked by Parliament about existing systems. There had been workshops about the future of rail. The Sishen/Saldanha and Hotazell/Port Elizabeth rail corridors meant nothing, as they ran through rural areas only. It could not create more jobs. The shortest route for manganese was to Saldanha, not to Port Elizabeth. The latter route was more expensive. He asked what benefits there were in developing that line. The question was whether branch lines had to be privatised. There were a lot of non-working lines in rural areas, and there was no job creation. Everybody was working in circles. More pipelines should be developed to get trucks off the road. Fuel trucks could be moved off the road.

Mr Vilana responded that private sector investment was indeed required. Government could not invest alone. But there were legal impediments that had not been amended yet. When private sector partnerships were discussed, the Department would bring the existing Railway Act into the picture. A new Act was needed for a new rail regime. Draft concepts had to be developed into a White Paper.

Mr Groenewald asked about railway lines into neighbouring countries. He asked how many local rail trucks were in neighbouring countries.

The Chairperson said that the Department had underestimated the topic. The Select Committee had asked about work done and strategies devised to move traffic off the roads to rail. It did not help if the Department gave a plan without costing it. The Department had said that it lacked funds, yet had not costed its plans. He pointed out that the deteriorating rail infrastructure referred to on page 3, was on account of the lack of a rail plan. Children and adults alike had to be educated not to vandalise rail structures. There were reports of railway sabotage. Railway metal was being taken and sold. He asked what was being done to protect it.

Mr Vilana responded that costing had in fact been done, and had been presented to the Infrastructure Development Cluster. The issue was what strategy had to be adopted for the move to rail. The Department could take the Committee through the plans and indicate what was being done. The problem was that the Department of Public Enterprises (DPE) owned rail.

Mr Vilana continued that insufficient funds were due to competing needs in government. As regards planning, the Department would both plan and implement policy. Whatever was being presented, was being implemented.

The Chairperson referred to the lack of customer focus alluded to on page 13. Government had taken the lead by building an infrastructure to make things easier for customers. Customers were lost because rail was not available to move maize. In his opinion, railways were good under the previous government. The Department of Transport was building new roads, but the question was how long would they last. He asked about the lifespan of railways that were said to be ageing. At Govan Mbeki municipality, trucks had to be used for the mines because there was no rail, except around Witbank. In that region there was often misty conditions which made the roads more dangerous. Rail was an alternative to that.

The Chairperson continued that the Select Committee had to meet with the Department soon so it could be supplied with more detail. There were challenges besides moving loads like coal off the road. The transportation of maize also needed attention. The document was silent on many issues. The Select Committee could help with accessing the budget, but it had to be properly informed. There had to be a contribution to rail development during the current term. Customers had to be provided with an infrastructure. An oversight visit to Port Elizabeth had revealed a total lack of infrastructure. Customers and investors were not being attracted. The question was how the Department was going to market itself.

The Chairperson said that he wished to encourage interaction with the DPE. He asked if the Department was meeting with the DPE. Problems that had been realised long ago, were never discussed interdepartmentally. Such discussion had to take place to empower the Committee to fast-track matters, also through budget recommendations. The President had called for the creation of 500 000 jobs. There had to be a contribution to that. The progress of interdepartmental discussion had to be reported on. The Ministers could consult with MECs in the provinces, and meet with other entities.

Mr Jacobs said that he wished to echo the Chairperson on that. There was one government with many departments and synergy was needed. Interaction had to take place around areas where departmental mandates overlapped. Wrongs could be corrected through linkage and interrelation. With regard to legislation as  stumbling block, he suggested that amendments be brought before the Committee, so that favourable new laws could be developed. Before deregulation in 1989, no maize could be moved by road truck. Acts had to be biased towards needs. There had to be action on the ground.

Mr Vilana replied that there was a platform of interdepartmental meetings chaired by the Ministers. However, that could remove constitutional impediments in the form of prescriptions about what Transnet or the DPE had to do. Transnet was owned and managed by the DPE. Amendments could only be brought before the Committee once the White Paper had been developed. The Rail Act would be used as a basis.

Mr Groenewald protested that his questions about the development of rail lines; privatisation; pipelines and rail in neghbouring countries had not been answered.

Mr Vilana responded that the branchline from Hotazell to Port Elizabeth was only an option. It was not definite. There were the options of moving through Sishen or Port Elizabeth. The mining houses and Transnet had to negotiate the matter. A strategy would be finalised and worked into a Green Paper. The consultation process had begun. A branchline strategy would be based on Transnet objectives. Pipelines were the responsibility of the Department of Energy. There were constitutional impediments and institutional arrangements that created bottlenecks.

Mr Vilana continued that Transnet had to get involved in the matter of railways in neighbouring countries. There was a need for regional integration. He did not currently know how many local trains were in neighbouring countries. He reiterated that rail had not worked under Apartheid, and that the country had missed out on five major revolutions in rail technology. Rail technology and strategy had not changed fundamentally since 1901. He expressed the hope that further transformations in rail would not be missed out on again. 

The Chairperson concluded that members were clear about Constitutional impediments. The Select Committee were a team with a researcher attached. The matters raised with the Department had arisen from its own input. It was the Department who had admitted that it had known for a long time that there was a need to reverse the trend to road. The Committee for its part raised the question of why nothing had been done about it. The Committee did reading on the subject and made oversight visits on a continual basis. It was aware that the Department had realised the problems but had not acted to change them.

The Chairperson adjourned the meeting.


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